MALTA INTRODUCES CORPORATE GOVERNANCE CODE FOR FINANCIAL SECTOR
The Malta Financial Services Authority (‘MFSA’) has taken another step to the boost the island’s reputation as a financial center of choice with the introduction of a Corporate Governance Code.
The new Code aims to enhance corporate governance practices among Authorized Entities operating within the island’s financial services sector. The MFSA sees good corporate governance as a key factor in safeguarding consumers, market integrity and financial stability.
It centers on four main principles:
- The effective Board: The MFSA expects Authorized Entities to be led and controlled by an effective Board of Directors, responsible for the entity’s corporate governance arrangements.
- Internal controls: That various control mechanisms are in place, including Risk Management, Compliance, Internal Audit, ICT and Security Risk Management, and Business Continuity.
- Stakeholder engagement: The Board serves and enhances the legitimate interests of all the entity’s stakeholders.
- Corporate culture, corporate social responsibility (‘CSR’), and environmental, social, and governance elements (‘ESG’): The Board embraces ESG and CSR standards and principles in the entity’s strategy, to encourage greater focus on sustainable finance activities and projects and long-term value creation for stakeholders.
Entities will be expected to adhere to the Code in a way that is proportionate to the size, nature, and complexity of their operations. This Code does not apply to Listed Entities falling within the scope of the Capital Market Rules, nor to Authorized Entities which are also Listed Entities falling within the scope of the Capital Markets Rules, which contains more specific provisions covering those entities, including a Code of Principles of Good Corporate Governance.
What actions should you take around the new Code?
While some Authorized Entities may already be accustomed to the principles and standards set out in the new Corporate Governance Code, others will need to assess their current frameworks and potentially incorporate new practices. Amicorp can assist with that, helping Authorized Entities to develop and implement best-practice corporate governance principles.
Furthermore, the Amicorp team can assist entities with company administration services such as preparation of board resolutions, drafting of minutes from the board of directors meeting and submission of documents to the Malta Business Registry.
Amicorp Group is a global service provider with a dedicated network of international experts in over 30 countries. We offer customized solutions around cross-border structures and provide support at all business levels. This can include corporate assurance, regulatory compliance, specialized business alternatives, and multi-facet family governance and wealth structuring. In addition, we have specialized teams offering dedicated trustee services, SPV management services, and complex securitization support.
If you would like to find out more about the new Corporate Governance Code or how Amicorp can help your business, please contact the team here.